Abstract: Over the past decade, the need to increasingly leverage R&D expenditures has spurred the growth of R&D consortia in the USA. Yet, first generation consortia have often been disappointments and currently face dwindling support – especially from the private sector. The |horizontal| structure of many first-generation consortia is at the root of the problem: this structure leads to an |arm|s length| arrangement between a consortium and its members. Future consortia will need to adopt characteristics of vertical partnerships, while fostering information-sharing between vertical teams. That approach will provide R&D leverage by ensuring that first-tier problems are addressed and that a |technology pull| environment is created within member organizations.